The ECB left interest rates unchanged yesterday, but analysts expected a 0.1% interest rate cut to be delivered by September. ECB President Draghi stated that the economic conditions are getting worse and said that governments need to pitch in. All eyes are on Germany which disagrees with the ECB’s outlook on the economy. German Finance Minister Olaf Scholz added “It’s not necessary or wise to act as if we were in a crisis.” Uncertainty will accompany the Euro over the summer months as deflationary pressures mount as the Eurozone economy is cooling off fast. Is it time to add more hedges to your forex portfolio wit commodities such as Silver? Subscribe to the PaxForex Daily Fundamental Analysis and find out why more successful forex traders every day prefer to grow their portfolio as PaxForex!
Markets expected more from the ECB and BNP Paribas Asset Management Economist Richard Barwell pointed out that “There is a sense that they are scraping the bottom of the barrel on monetary easing. Hence fiscal policy will have to do more next time around.” Economic data released from Singapore through Germany, France and Italy came in mixed with a bearish bias and traders will get the preliminary second-quarter GDP report out of the US to close the trading week. How will this final piece of data impact price action in Silver? Today’s fundamental analysis will take a look at price action potential in this precious metal.
Here are the key factors to keep in mind today for Silver trades:
- South Korean Consumer Confidence: South Korean Consumer Confidence for July was reported at 95.9. Forex traders can compare this to South Korean Consumer Confidence for
- Singapore Unemployment Rate: The Singapore Unemployment Rate for the second-quarter was reported at 2.2%. Forex traders can compare this to the Singapore Unemployment Rate for the first-quarter which was reported at 2.2%.
- Singapore Industrial Production: Singapore Industrial Production for June increased by 1.2% monthly and decreased by 6.9% annualized. Economists predicted a decrease of 0.7% and of 7.9%. Forex traders can compare this to Singapore Industrial Production for May which decreased by 0.1% monthly and by 2.0% annualized.
- German Import Price Index: The German Import Price Index for June decreased by 1.4% monthly and by 2.0% annualized. Economists predicted a decrease of 0.8% monthly and of 1.5% annualized. Forex traders can compare this to the German Import Price Index for May which decreased by 0.1% monthly and by 0.2% annualized.
- French Consumer Confidence: French Consumer Confidence for July was reported at 102. Economists predicted a figure of 101. Forex traders can compare this to French Consumer Confidence for June which was reported at 101.
- French PPI: The French CPI for June decreased by 0.5% monthly. Economists predicted a decrease of 0.2%. Forex traders can compare this to the French CPI for May which decreased by 0.4% monthly.
- Italian Confidence Data: Italian Business Confidence for July was reported at 100.1 and Italian Consumer Confidence was reported at 113.4. Economists predicted a figure of 100.6 and of 109.6 Forex traders can compare this to Italian Business Confidence for June which was reported at 100.7 and to Italian Consumer Confidence which was reported at 109.8.
- US GDP: The Preliminary US GDP for the second-quarter is predicted to increase by 1.8% annualized. Forex traders can compare this to the first-quarter GDP which increased by 3.1% annualized. Preliminary Personal Consumption for the second-quarter is predicted to increase by 4.0% annualized. Forex traders can compare this to first-quarter Personal Consumption which increased by 0.9% annualized. The Preliminary GDP Price Index for the second-quarter is predicted to increase by 1.9% annualized. Forex traders can compare this to the first-quarter GDP Price Index which increased by 0.9% annualized. The Preliminary Core PCE for the second-quarter is predicted to increase by 2.0% annualized. Forex traders can compare this to the first-quarter Core PCE which increased by 1.2% annualized.
Should price action for Silver remain inside the or breakout above the 16.150 to 16.600 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 16.400
- Take Profit Zone: 18.600 – 19.000
- Stop Loss Level: 15.850
Should price action for Silver breakdown below 16.150 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 15.850
- Take Profit Zone: 13.850– 14.300
- Stop Loss Level: 16.150
Open your PaxForex Trading Account now and add this currency pair to your forex portfolio. Do you hedge your forex trading strategies with precious metals like Silver? Find out today why you should explore this option and why it represents a smart hedge!
